Debenhams administration a ‘major blow’ to Southend and Basildon

The leader of Southend Council has said losing Debenhams from the town centre would be a “major blow” to the High Street economy.

The council leader spoke about the retail giant after it emerged it is on the brink of filing for administration for the second time in a year.

Currently the firm has 142 stores closed and the majority of the 22,000 staff on furlough. It is understood the current owners want to push the business into administration then buy it back debt-free.

Councillor Ian Gilbert (Lab), leader of Southend Council, said the presence of Debenhams in the town is “vital”.

He said: “I understand that Debenhams entering administration is a short-term move to protect the business from creditors whilst a rescue package is put together.

“I very much hope that the store continues to trade as it’s a vital part of the High Street economy.

“Losing Debenhams would certainly be a major blow.”

He added that he hoped news of the council’s deal with Southend United to build homes around a proposed stadium on Fossetts Farm, off Eastern Avenue, rather than shops will attract extra investment in the town and “help the High Street recover rapidly when the current crisis is over”.

Debenhams has called the move a “light touch” administration that will see the existing management team remain in place and under direct supervision of administrators from FRP Advisory.

“This move will protect Debenhams from the threat of legal action that could have the effect of pushing the business into liquidation while its 142 UK stores remain closed in line with the

Government’s current advice regarding the Covid-19 pandemic,” it said.

Basildon could also be set to lose a store if the firm cannot recover.

Basildon Council’s deputy leader, Cllr Kerry Smith (Ind), said: “This is bad news for any high street but particularly for Basildon.

“However, when we formed this rainbow alliance that controls the council last year the leader Cllr Gavin Callaghan set about creating a town centre revival committee.

“The tragic news of the closure justifies further why we need to carry on with the work being done by that committee to revive our dying town centre.”

Last year a major restructure by Marks and Spencer saw the Basildon store close after more than 45 years, leaving Debenhams as one of the few big names remaining in the town.

Steve Shaw

Local Democracy Reporter